Holt Renfrew & Co. Ltd. will expand its retail space in Montreal by merging its Ogilvy store with its own banner in one store, as it faces fiercer competition in the luxury retail sector.

Holt's unveiled on Tuesday its vision for a transformed Ogilvy store on the city's prime St. Catherine's Street shopping strip, turning it into the single largest outlet within the Holt's network and adding more heft to the chain's upscale fashion offerings. By 2017, Holt's will create a rebranded "Ogilvy, part of the Holt Renfrew & Co. collection" to battle new upscale competitors.

Holt's is gearing up for a changing luxury landscape: Next fall, U.S. high-end chain Nordstrom Inc. will arrive in Canada with its first store, and plans as many as 10 here eventually. Saks Fifth Avenue will also come to Canada within the next couple of years following this month's acquisition of New York-based Saks Inc. by Hudson's Bay Co. It plans about seven Saks outlets here, including one within its Montreal flagship store on St. Catherine's Street.

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Holt's, the country's leading luxury retailer with nine stores, is expected to feel the effects of the new rivals as consumers try out the new players.

And Holt's has been expanding in other ways. It is investing $300-million over the next couple of years to bolster its stores, including doubling the space at its location at Yorkdale Shopping Centre, one of the country's top performing malls. Earlier this year, it launched its first two lower-priced hr2 stores, which will compete with Nordstrom's Rack outlets and Saks' Off 5th, which are also slated to arrive in Canada within the next couple of years.

In Montreal, the new Ogilvy store will be 220,000 square feet, roughly twice the size of its sister Holt's store a few blocks away on Sherbrooke Street. Holt's said it will confirm "at a future date" its plans for that property post-2017. It's expected to redevelop it and keep some retail space on the premises.

In the meantime, until 2017, Holt's will continue to operate its Sherbrooke Street store with plans for a new Prada shop and the recent introduction of a new Dior boutique. There had been speculation that Holt's would drop the Ogilvy name entirely and replace the St. Catherines Street store with its own banner.

Now, the revamped St. Catherines Street Ogilvy store will expand to include an adjacent location, following a $60-million investment by Holt's in the new store.

"The Montreal market presents a unique opportunity to leverage two storied brands," said Mark Derbyshire, president of Holt's. "Inspired by the best of both Holt Renfrew and Ogilvy, and based on extensive customer research, we have developed a grand vision with bold new concepts that celebrate Montreal's rich fashion heritage and sophisticated shoppers."

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Terry Henderson, president of the Quebec division of consultancy J. C. Williams Group, said the name Ogilvy still resonates among Quebeckers, including francophones who refer to it as "chez Ogilvy."

He said Ogilvy has waned over the years as it became a collection of spaces leased to other brands. "We're due for an upgrade."

The rebranded Ogilvy's will focus exclusively on luxury specialty retail fashion and beauty, while the store currently has a floor of home decor merchandise as well.

Ogilvy, founded by Scottish-born James Angus Ogilvy, established itself over the years as a Montreal institution, known for its daily lunchtime concert by a bagpiper winding his way through the aisles, a tradition that continues to this day.

The Weston family owns other luxury fashion retail chains, including Selfridges in Britain and Brown Thomas in Ireland. It also controls Canadian grocer Loblaw Cos. Ltd.

To steer the new Ogilvy concept, Holt's named Joanne Nemeroff, a seasoned fashion retail executive who previously headed lingerie powerhouse Victoria's Secret in Canada, as a Holt's senior vice-president. She will be based in Montreal.

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